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Compliance structure and report
We consider an efficiently functioning compliance structure to be an essential tool for ensuring adherence to external rules and regulations as well as requirements imposed in-house. Our compliance structure was therefore most recently reviewed in 2015 against the backdrop of compliance requirements associated with Solvency II.
The Chief Compliance Officer and the Compliance Department inform employees about changes in legislation affecting the legal areas in which they work, insofar as their tasks are affected. A worldwide compliance network of responsible compliance officers at the international locations supports the Chief Compliance Officer in his duties and reports to him. This means that local compliance violations can also be reported directly outside the local hierarchy. The Executive Board is updated on major compliance issues and developments in a report compiled annually by the Chief Compliance Officer.
The Chief Compliance Officer works to ensure compliance with internal company guidelines by cooperating with other in-house departments, including Group Auditing.
With a view to improving cooperation within the compliance network on the European level, we organise an annual gathering of European compliance officers. Supplementary to this, conference calls are held in the quarters when no meeting is held. This brings about closer coordination and facilitates verification of the implementation of compliance measures.
Whistleblower system
A Web-based whistleblower system has also been set up for the Group companies so as to enable employees, customers and third parties to report – anonymously if they so wish – serious compliance violations in the respective local language or in English. Employees throughout the Group are able to seek advice on compliance matters through an e-mail address linked to the Compliance Department. Any tips and the resulting measures taken are included in the annual Compliance Report. In the year under review no tips were received through the Group-wide whistleblower system regarding potential wrongdoing. Nor were any instances of discrimination reported to us through the whistleblower system in the year under review. Furthermore, no lawsuits were filed against our company in the reporting period or in previous years on grounds of anti-competitive or anti-trust practices. Similarly, we were not required to pay any significant fines in the period under review or previous years due to violations of legal provisions; nor were any non-monetary sanctions imposed on our company.
The Compliance Department is complemented by several Compliance Committees, the members of which come from the business groups as well as from the areas of Group Legal Services, Finance, Accounting and Investments. The Compliance Committees examine certain reinsurance contracts with a special eye to compliance with supervisory law, accounting requirements and other standards.
In 2016 we updated our Corporate Compliance Organisational Manual (known as the Compliance Manual). This manual summarises the main activities in the area of corporate compliance. It also describes the responsibilities within our company, the interfaces between Group Legal Services (Compliance Department) and other areas as well as the various components of the compliance organisation.
In 2017 the Bundesbank conducted a foreign trade audit at E+S Rück that did not give rise to any objections. The Federal Financial Supervisory Authority (BaFin) also conducted two local audits at Hannover Re and E+S Rück to verify aspects of our internal model, especially those relating to the operational risk. No objections were raised in this regard either.
Compliance training
All new company employees in Germany participate in our compliance training when they join the company;
this covers, among other aspects, the topic of corruption and appropriate practices that are in
conformity with the law. In the year under review three training activities were held for altogether 81
employees. In order to stay updated on compliance issues such as combating corruption, we use
traditional communication channels including intranet portals and online newsletters. Important
information of company-wide relevance is made available to staff in the intranet. In addition, all
underwriting and accounting departments
received training in the topic of trade embargos in the year under review.
With effect from 2018
onwards we have organised a mandatory corporate governance training activity for our underwriters in
property and casualty reinsurance at the Hannover location. The training gives our staff an initial
insight into legal bases, internal guidelines and standards as well as an overview of the various
in-house committees. Questions relating to general compliance matters and fighting corruption are also
discussed. Altogether, some 300 employees received this training when the measure was first held. A
similar training activity was organised in August 2018 for our life and health reinsurance underwriters.
This measure will be expanded in the third quarter to include the international offices.
The Compliance Report for the 2017 calendar year was submitted to the Finance and Audit Committee in March 2018. The report describes the structure and wide-ranging activities of our company in this regard. The findings of the separate data protection reporting for the 2017 calendar year are also included in the Compliance Report. After in-depth explorations of topics such as directors' dealings, ad hoc and other notification obligations, the insider list, consultancy agreements, data privacy and international sanctions, the report concludes that only a few facts and circumstances were known that would suggest violations of compliance-related provisions. Altogether, one compliance-related incident was reported. After extensive examination of this incident the necessary precautions were taken in order to ensure for the future that we are in conformity with the internal and external requirements governing our business operations. As a consequence of the incident, we implemented a number of compliance and audit measures at the affected international office so as to improve the internal control system on the local level and at the interface between headquarters and the branch.
Our annual compliance risk analysis was carried out in the year under review in cooperation with the areas of Human Resources Management, Accounting and Taxation. As a result of this risk analysis, the possible risks of non-compliance and the steps taken to prevent non-compliance were documented and examined with an eye to their adequacy.